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Wednesday, February 27, 2008

NY Times: Ohio workers screwed, but not by NAFTA

The New York Times carries an interesting story this morning about Hillary Clinton and Barack Obama's double-barreled denouncement (or is it rejection?) of NAFTA, which writer David Leonhardt likens to the way Republicans have treated abortion over the last several campaigns -- lots of tough talk to satisfy the base, but little to no reform. ...

This straddling has served Republicans well. They have been able to win over voters who care about abortion above all else without alienating swing voters, most of whom, polls show, think it should be legal at least some of the time. Talking tough and governing gently helped the party build a majority.
Now come Mr. Obama and Mrs. Clinton, campaigning across Ohio with a similar kind of tough talk about foreign trade. Based on what they’re saying, you’d have to conclude that they believe that Nafta and other trade agreements have caused Ohio’s huge economic problems.
“She says speeches don’t put food on the table,” Mr. Obama said in Youngstown. “You know what? Nafta didn’t put food on the table, either.” Later, he went further, claiming that Ohio’s workers have “watched job after job after job disappear because of bad trade deals like Nafta.”
Mrs. Clinton’s advisers, meanwhile, have been putting out the word that she tried to persuade her husband not to support Nafta — which liberalized trade with Mexico and Canada — when he was running for president. (He did support it, aggressively, and signed it into law in 1993.) “I’m not just going to talk about what’s wrong with Nafta,” she said in Youngstown, the day after Mr. Obama had been there. “I’m going to fix it and I have a four-point plan to do exactly that.”

But the plans, Leonhardt points out, don't do much at all to alter trade. Although according to the economists he quotes, that's a good thing. Because it's not reducing trade that's going divert Ohio from its current course toward becoming Kabul West anyway.

The solution should involve more government investment in infrastructure, the medical sciences, alternative energy and other areas that could produce good new jobs. A more strategic approach to investment, one less based on the whims of individual members of Congress, would also help.
“While our competitors — China and others — are investing heavily in infrastructure,” Donald Plusquellic, the mayor of Akron, the world’s onetime rubber capital, told me, “we’ve done a terrible job reinvesting in America.”
But as Mr. Slaughter, a former adviser to President Bush, points out, the payoff from these investments won’t come for a long time. They will do little to help former factory workers who have had to take lower-paying jobs — which is one reason that calling for new investments doesn’t bring nearly the cheers on the campaign trail that denouncing Nafta does.
The best way to help those workers, Mr. Slaughter argues, is to cut their taxes and make the tax code more progressive. This would allow global trade to continue expanding the country’s economic pie, while making sure that high-income workers weren’t the only ones benefiting.

-- Read the full story here, and the Times' debate coverage here. -- Joe P. Tone